ASIC moves on ‘misleading’ land banking schemes

ASIC has commenced proceedings in the Federal Court to freeze assets and wind up companies associated with two Victorian land banking schemes.

The regulator is seeking to appoint liquidators to development companies Bilkurra Investments and Foscari Holdings for their operation of the two schemes, known as Hermitage Bendigo and Foscari.

ASIC said it is concerned the development companies are insolvent, and that it is “just and equitable that the companies are wound up” to protect the interests of investors.

“ASIC’s investigations suggest investors may have invested in the land banking schemes on the basis of misleading representations, and that option agreements entered into by investors in Hermitage and Foscari purportedly allow for monies invested in the schemes to be used for any purpose whatsoever, and need not be used to progress the two land banking schemes,” the regulator said.

“ASIC is also concerned that Hermitage and Foscari are not close to completion and appear to be incapable of completion due to the financial position of the development companies.”

In addition, ASIC is taking action against Project Management (Aust) Pty Ltd (PMA) and Michael Grochowski, with the regulator alleging that both parties were involved in the operation of the land banking schemes, and that bank accounts relating to the development companies were operated by PMA.

The proceedings are part of ASIC’s wider and ongoing investigation into land banking.